There is a such a wealth a cool, free literature in the public domain at Project Gutenberg. I have read the usage notes at the end of the works, but I am still not sure of the legal issues involved in using the pieces for a game. Could a person design a game based on or even directly related to the works presented there without any legal repercussions? Any lawyer gamers in the house?

As we say here: I'm not a lawyer nor even living in the same country you are, so the laws I know well are different. And in any case the trick to being well-informed about legal matters for serious purposes is to consult a lawyer, not a web forum. Those things aside, here's what I know of the matter:

First: Project Gutenberg does not store only public domain works, so make sure that the work is really in the public domain or otherwise under a suitable free license that allows what you're doing.

Second: If the work you're eyeing is really in the public domain, then it does not have commercial copyright anymore. This means that nobody can sue you for publishing the work as is, or using it for a derivative work, such as a game.

Complication: Some countries have a thing called "moral rights of the author", a separate set of rights related but distinct from commercial copyright. Finland is one of these places, for instance. A peculiar property of moral rights is that you can't sell them or give them away, so strictly speaking a free work in Project Gutenberg might still have some moral rights involved with it, depending on how old it is. For our purposes (and remembering that I'm speaking of the Finnish law, with which I'm familiar) the most important moral rights are the author's right to be recognized as the creator of the work and the author's right to be protected from offensive uses of his work. So those are a few things to look out for.

Conclusion: It is very unlikely that you could manage to break any laws by using an old historical work in your game, even verbatim. I know that I've myself considered making f.ex. a Conan game now and then - there are quite many interesting properties out there that are quite available for use for an informed IP-looter.

There is a such a wealth a cool, free literature in the public domain at Project Gutenberg. I have read the usage notes at the end of the works, but I am still not sure of the legal issues involved in using the pieces for a game. Could a person design a game based on or even directly related to the works presented there without any legal repercussions?

For works in the public domain, yes.

Like you, I read through the notes at the end. They're pretty clear. If you delete all the notes, top and bottom, you can do what you want with the text.

Obviously, this is just my personal opinion. But as a personal opinion: yes.

I strongly suggest seeking legal advice from non-Forge sources. We're not lawyers; this is basically hearsay. The forums on the Intellectual Property Law Server are a great place to ask this sort of thing.

Yes, I understand. I should not have mentioned lawyers. I was not quite serious about the term "lawyer." Silly me. I just wanted some initial, general feedback. Thanks for your concern, and sorry for any confusion I caused.